GeorgeM777
Expert Alumni

Business & farm

Yes, if you recovered the cost of your vehicle in 2015, then your basis in your business vehicle would be zero.  If you were to sell your business vehicle, then as noted in a previous post some of that depreciation might have to be recaptured, and yes, TurboTax will calculate the amount, if any, that needs to be recaptured.  

 

Let's assume you continued to use your vehicle for business after you have fully recovered its cost through the use of the standard mileage rate, IRS guidance provides that you can continue to use the standard mileage rate with no adjustments to such rate.  IRS Publication 463 provides the following:

Depreciation adjustment when you used the standard mileage rate. 

 

If you used the standard mileage rate for the business use of your car, depreciation was included in that rate. The rate of depreciation that was allowed in the standard mileage rate is shown in the Rate of Depreciation Allowed in Standard Mileage Rate table, later. You must reduce your basis in your car (but not below zero) by the amount of this depreciation. 

 

If your basis is reduced to zero (but not below zero) through the use of the standard mileage rate, and you continue to use your car for business, no adjustment (reduction) to the standard mileage rate is necessary. Use the full standard mileage rate (58.5 cents (0.585) per mile from January 1–June 30 and 62.5 cents (0.625) per mile from July 1–December 31 for 2022) for business miles driven. 

 

These rates don’t apply for any year in which the actual expenses method was used. 

IRS Publication 463 at page 24.

 

@Katharine55 

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